ALP locks in on $3,000 tax affairs deduction cap

The Federal Opposition has confirmed people will be faced with maximum deductions of just $3,000 for managing their tax affairs under any future Labor Government.

This was confirmed by the Shadow Treasurer, Chris Bowen, who made clear that such a policy move would be central to the Australian Labor Party’s policy to be taken to the next election alongside reforms to negative gearing and capital gains tax (CGT).

Addressing the National Press Club in Canberra, Bowen accused the Turnbull Government of leaving loopholes in the tax system which allowed 48 people in 2014-15 who earned more than $1 million to pay zero tax.

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“A staggering nineteen of these people claimed an average of $1.1 million in deductions for the use of the lawyers and tax advisers that helped them pay no tax,” he said. “Compare this to the average person who claimed a deduction, claiming just $378,” he said.

“It’s these sorts of loopholes that Australians are right to feel fed up about. At a time when the Government wants to blow a $65 billion hole in the budget for its corporate tax cut, there is no excuse to not address these inequities.”

Bowen said that a Labor Government would cap managing tax affair deductions at $3,000 per year and that it would raise $1.8 billion over the decade while affecting less than one per cent of all taxpayers.

“Following on from our reforms to negative gearing, capital gains tax, and superannuation, it’s the next step in Labor’s plans to make our tax system fairer,” he said. “These reforms will like our reforms to negative gearing and capital gains help build trust that the tax system is working for everyone, not just a wealthy few.”




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Another tax on small business. Add the roll back on tax deductions on geared investments and it looks likes the the Turnbull government will be our next government as well. He has some genuine idiots in his cabinet advising him or he really is this dumb

The article seems to be talking about individuals and not companies.

A company has very different tax needs to individuals and i would suggest that accounting fees for BAS, PAYG, Payrol etc etc would still be a cost of business.

This is a great initiative by ALP politicians if it ever comes to be. Accountants, being highly skilled number crunchers will quickly work out the best way to keep these clients with fully tax deductible fees, is to charge their lower value, simple return taxpayers more. This will mean greater fairness in accounting clients equally sharing the burden of accounting fees across our nation. Well thought through policy Comrades.

The people paying those fees are being ripped off by the big chartered firms - they charge on the basis that if you have more you should pay more, it's unconscionable and they should be on A Current Affair.

Hi Dezza, I'm not sure they are being ripped off. In my business I pay $6,500 per annum on monthly instalments plus another $1,600 for my personal tax return. The monthly fees of $541 cover the Accountant and staff for recording and submitting returns for monthly PAYG payments for staff as well as quarterly GST compliance and calculation and submission.
I would agree that some Accountants over-charge, but everyone is entitled to be rewarded adequately for their work and a good Accountant is worth paying a reasonable amount for.

As a small business-owner, why should I pay a legitimate business expense of $8,100, but only be able claim $3,000 of this? The people that will be most affected by this proposal will be small businesses like mine, not the Accountant. Unless I increase my profit by increasing prices or reducing costs.

I look it it differently. If the average tax deduction is only $370, then stop all these small petty deductions (of $1 per day) and encourage people to generate real wealth and investment income and build the country and the economy so we all do better. Stop people wasting time trying to save $1 per day.

Insane, most small medium businesses would pay this just getting BAS/Payroll etc done, I don't know where these people get these ideas . Effecting less than 1% of tax payers? Please. Bit like the claims that the Age Pension threshold changes wouldn't effect many.

Once again Labor showing it's complete incompetence. Their incompetence really makes the idiots currently in Government look awesome

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